Drop Shipping

Have you ever heard about drop shipping and how it can become an undeniable truth of e-commerce industry in the future? Let me first explain you the concept of drop shipping. It’s a business model where retailers don’t actually get to keep the inventory in their possession nor process the orders. In simpler words, it’s a practice of order fulfillment where a manufacturer or a distributor ships a product to the consumer on behalf of the retailer. Initially, several big sharks of the e-commerce market such as Amazon, Zappos, etc. started out with drop shipping and have become the inspiration for a million other retailers.

So, the main concept is, being a retailer you are capably selling a product which you don’t even own.  So, as a retailer you set up an online store, display products, place mark-up price, forward the order to your supplier and sell it to clients. The supplier then ships the product to your customer on behalf of your company.

You might think how drop shipping e-commerce business can be of any help to you? We promise to give you 5 strong reasons to try drop shipping e-commerce business this year. The reasons listed below are enough to compel both startups and seasoned entrepreneurs to try out drop shipping.

  1.  Bid Goodbye to Product Sourcing!

According to the traditional e-commerce model that online stores used to follow, the stores are required to source the products directly from wholesalers placed in different countries. The whole process of ordering products and getting it from wholesalers requires a lot of time, money and resources of yours. It also involves cost incurring intermediaries such as banks, cargo shipments, export-import agents etc.  Contrarily, in drop shipping retailers can sell the products without having to source it from the wholesaler in large quantities. Thereby, streamlining the whole process and making it a lot easier for the retailer.

  1.    Low Investment Cost

The biggest advantage of implementing drop shipping to your business is that you can easily launch a store without having to invest thousands of dollars in inventory in advance. Physical retailing stores do require a big investment before actually being able to step in the market. However, drop shipping gives you a facility of not having to buy a product until or unless a customer has ordered it. This ultimately reduces the start-up’s costs and reduces risk as well. Additionally, a conventional e-commerce store requires a large space for storage calling for extra expenditures, which is not the case of drop shipping.

  1. Keep Your Time and Money Safe

What will be your first expression, if you get to know that to start a business you do not have to set up a physical store? You might feel amazed and fascinated. Because who would want to spend extra money and time in managing a physical warehouse, if they can start their business without it. Apart from this, your packing and shipping costs are saved too whilst it also eliminates the need to monitor and maintain the stock levels. All these things, i.e. receive, stack, store, pull, pack, and shipping the product are going to save your time and money both which can be better utilized in the drop shipping business.

  1. Unmatched Scalability!

When you start drop shipping business, it gives a merchant a way to test new products without even bringing the same to inventory. Didn’t understand? Let us give you an example- suppose a retailer who sells western style riding products, gets requests from customers for English style riding accessories. If you have a drop shipping agreement with a supplier of English style riding accessories, then you can effortlessly explore how well will those English products sell without even spending too much. The retailers only need to concentrate on marketing and improving customer service sides and do not have to care about the warehouse rentals and other expenditures.

  1. Risk is Minimized

When we say the risk is minimized, we mean that while drop shipping you do not have to acquire the inventory. So even if your business falls, you do not have anything to lose except for the money you invested in starting your website. This, in turn, means that your startup or business is less exposed to loss of revenue due to change in trends.

Final Thoughts

E-commerce industry has been creating marvelous opportunities for all kinds of businesses, it is up to you how you plan on utilizing them. And currently, drop shipping is on the boom, so you must consider trying it out. It is very essential to choose a right drop shipper as the only medium you work with wholesalers is via the web. So, it advisable to take enough time and delve deeper into selecting criteria. The probability of a virtual shop getting more popular than the conventional store. There is no harm in following the easy curve of drop shipping, but the only prerequisite is the knowledge that should be gained.

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